On 17 October 2023, the European Council (the "Council") has updated the list of non-cooperative jurisdictions for tax purposes. Antigua and Barbuda, Belize and Seychelles have been added to the EU list of non-tax cooperatives jurisdictions. The EU List is published as an annex to the conclusions adopted by the ECOFIN Council (Annex I). The purpose of this EU List is to encourage jurisdictions, through cooperation, to make positive changes to their tax legislation and practices.
As a reminder, in 2016 the Council tasked the Code of Conduct Group to carry out the preparatory work with a view to drawing up a list to help promote good tax governance worldwide.
The Code of Conduct Group has established a list of 92 jurisdictions on the basis of the following criteria:
- Their economic ties with the EU;
- Their institutional stability;
- The importance of the country’s sector.
The first EU list was issued on 5 December 2017 and included jurisdictions that had not made sufficient commitments in response to the EU’s concerns.
The tax cooperative jurisdictions’ assessment is made on a series of criteria established by the Council, mainly focusing on:
- Tax transparency;
- Fair taxation; and
- Measures against base erosion and profit shifting.
Since its creation in 2017, the EU List has been regularly updated to consider the following elements:
- Updating the criteria in line with international tax standards;
- Screening countries against these criteria;
- Engaging with countries that do not comply;
- Listing and de-listing countries as they undertake reforms; and
- Monitoring developments to ensure that jurisdictions do not backtrack on previous reforms.
Whilst since October 2023, Antigua and Barbuda, Belize and Seychelles are treated as non-compliant with the standard concerning the exchange of tax information on request, the following three jurisdictions have been removed from the EU List:
- British Virgin Islands further to amendment to its framework on exchange of information on request;
- Costa Rica upon amendments of its harmful aspects of its foreign source income exemption regime; and
- Marshall Islands which made significant progress in enforcement of economic substance requirements.
As a result, the EU list now includes 16 jurisdictions: American Samoa, Anguilla, Antigua and Barbuda, Bahamas, Belize, Fiji, Guam, Palau, Panama, Russia, Samoa, Seychelles, Trinidad and Tobago, Turks and Caicos Islands, US Virgin Islands and Vanuatu.
The next revision of the EU List should be conducted in February 2024.
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